Editorial: Wolf at the door? Guv changes tune on tax hike

First, both the House and Senate signed off on a huge step forward in the sales of alcohol in Pennsylvania, paving the way for citizens to be able to buy a bottle of wine in their local supermarket.

Gov. Tom Wolf, who has not exactly been a fan of moves to get the state out of the booze biz, quickly signed the measure into law.

Then legislators took a shot at one of the state’s most pressing issues – the ticking time bomb that is buried in every state spending plan. That would be the massive deficit that continues to grow insidiously inside the state’s two large public employee pension plans. Legislators are looking to do something that is long overdue – change the rules for future employees to get them, at least in part, out of a defined benefit plan and instead offer a defined contribution format. That would give them something in common with most employees in the private sector, who deal with the vagaries of 401k accounts as opposed to the relative safety and stability of a defined benefit pension plan.

Of course, that’s not the only budget issue the state faces. That’s why something Gov. Wolf said yesterday raised more than a few eyebrows.

You might remember the governor and Republican leaders in the Legislature did not exactly see eye to eye on his first spending plan. Wolf wanted a huge boost in spending, at least in part to replenish education funding he said was stripped away by his predecessor, Republican Gov. Tom Corbett. To do that he suggested raising both the state personal income tax as well as the sales tax, along with a new levy on the state’s natural gas business.

Republicans in Harrisburg immediately began clutching their chest.

Not even a defibrillator could revive this standoff. The two sides locked horns for nine long months, trading accusations seemingly every week along the way. In the meantime, a lot of people got hurt. Schools were left in the lurch in terms of their state funding. Social service agencies curtailed their services. Several counties, including here in Delco, withheld tax payments to the state.

Eventually, Wolf allowed a GOP spending plan to become law, holding his nose and not even bothering to affix his John Hancock to the document, allowing it to become law without his signature.

Now, courtesy of that nine-month deadlock, the two sides are preparing to do it all over again. Wolf, still battered and bruised from his first budget go-round with the Legislature, must have been overcome with a sense of déjà vu. He once again initially called for hefty increases in spending – and whopping tax hikes to pay for them.

But this week, maybe finally shaking the cobwebs from the beating he took in his first budget go-round, he changed his tune.

The Democrat is now hinting broadly that he can still attain his budget priorities without increases in either the income or sales taxes.

He also is lowering his request for new funding for public schools.

It’s a little late for April Fools, so we’re taking the governor at his word.

“I think we can do all this – a balanced budget, the increase in education, and the heroin initiatives – without a broad-based tax increase,” Wolf said.

All of this comes as the deadline to have a new spending plan in place looms a little more than a week down the road. Negotiators have been huddling behind closed doors, with little in the way of news on any breakthroughs.

The governor now says he will put his weight behind a plan for a balanced spending plan that includes an additional $34 million to attack one of the state’s biggest social concerns, the burgeoning opioid addiction epidemic, and another $250 million for schools. His initial budget draft called for a $350 million boost, a healthy 6 percent increase in education funding.

Gone, or at least seriously downplayed, are his gaudy request for a $3.3 billion spending increase paid for by $2.7 billion in tax hikes.

That’s sure to make Republicans happy.

What isn’t known is if it will lead to a budget accord – in time to meet the July 1 deadline.

Wolf deserves a round of applause for changing his tune on the budget, reining in his requests for both increases in funding and tax hikes to pay for it.

Now all he has to do is get everyone else in Harrisburg on board.

Whatever it is they’re putting in the water out there, they might need to double it.

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